St. Helens Suit Moves to State Court

After a federal judge dismissed plaintiff Steven Knebel’s case against the $170 million St. Helens Community FCU of St. Helens, Ore., and five directors on May 20, saying he had no private right of action in federal court, Knebel filed suit in Oregon state court Wednesday.

Knebel is suing the credit union over alleged bylaw violations during a directors recall election. According to court documents, the credit union counted mailed recall ballots, which contradicts federal credit union bylaws that require recall elections only count votes cast in person during a special meeting.

“Prior to the special meeting, the defendant Credit Union solicited mail-in votes from all members by delivering to each member an absentee ballot and return envelope, along with instructions for voting. Members were allowed and encouraged to submit their mail-in ballots at any time prior to the special meeting of September 4, 2012. Along with the mail-in ballots, the Credit Union distributed one or more letters advocating for the retention of all five directors subject to the removal vote,” Knebel’s attorney, Drew Gramson, said in the complaint.

St. Helens Community has not commented on the case, citing a policy against commenting on pending litigation.